Brisbane
Brisbane home values remain slightly in the red on an annual basis, with home values -0.5 per cent lower in May than the same time last year. Over the first five months of 2009 Brisbane has begun to once again show positive growth. During the first five months of the year house values increased 1.6 per cent whilst unit values fell by -0.3 per cent despite the fact Brisbane is home to mainland Australia’s most affordable unit market. Rental returns for houses have softened slightly and currently sit at 4.6 per cent whilst unit rental yields continue to improve and are now recorded at 5.5 per cent.
Tuesday, June 30, 2009
Friday, June 12, 2009
Life wisdon from Bill Gates
Love him or hate him, he sure hits the nail on the head with this! Bill Gates recently gave a speech at a High School about 11 things they did not and will not learn in school. He talks about how feel-good,politically correct teachings created a generation of kids with no concept of reality and how this concept set them up for failure in the real world..
Rule 1: Life is not fair - get used to it!
Rule 2 : The world won't care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.
Rule 3 : You will NOT make $60,000 a year right out of high school. You won't be a vice-president with a car phone until you earn both.
Rule 4 : If you think your teacher is tough, wait till you get a boss.
Rule 5 : Flipping burgers is not beneath your dignity. Your Grandparents had a different word for burger flipping: they called it opportunity.
Rule 6: If you mess up, it's not your parents' fault, so don't whine about your mistakes, learn from them.
Rule 7: Before you were born, your parents weren't as boring as they are now. They got that way from paying your bills, cleaning your clothes and listening to you talk about how cool you thought you were. So before you save the rain forest from the parasites of your parent's generation, try delousing the closet in your own room.
Rule 8: Your school may have done away with winners and losers, but life HAS NOT. In some schools, they have abolished failing grades and they'll give you as MANY TIMES as you want to get the right answer. This doesn't bear the slightest resemblance to ANYTHING in real life.
Rule 9: Life is not divided into semesters. You don't get summers off and very few employers are interested in helping you FIND YOURSELF. Do that on your own time..
Rule 10: Television is NOT real life. In real life people actually have to leave the coffee shop and go to jobs.
Rule 11: Be nice to nerds. Chances are you'll end up working for one.
If you agree, pass it on.
If you can read this - Thank a teacher!
Most of all Thank A Veteran for keeping our country free so this can be passed on to someone else.
Rule 1: Life is not fair - get used to it!
Rule 2 : The world won't care about your self-esteem. The world will expect you to accomplish something BEFORE you feel good about yourself.
Rule 3 : You will NOT make $60,000 a year right out of high school. You won't be a vice-president with a car phone until you earn both.
Rule 4 : If you think your teacher is tough, wait till you get a boss.
Rule 5 : Flipping burgers is not beneath your dignity. Your Grandparents had a different word for burger flipping: they called it opportunity.
Rule 6: If you mess up, it's not your parents' fault, so don't whine about your mistakes, learn from them.
Rule 7: Before you were born, your parents weren't as boring as they are now. They got that way from paying your bills, cleaning your clothes and listening to you talk about how cool you thought you were. So before you save the rain forest from the parasites of your parent's generation, try delousing the closet in your own room.
Rule 8: Your school may have done away with winners and losers, but life HAS NOT. In some schools, they have abolished failing grades and they'll give you as MANY TIMES as you want to get the right answer. This doesn't bear the slightest resemblance to ANYTHING in real life.
Rule 9: Life is not divided into semesters. You don't get summers off and very few employers are interested in helping you FIND YOURSELF. Do that on your own time..
Rule 10: Television is NOT real life. In real life people actually have to leave the coffee shop and go to jobs.
Rule 11: Be nice to nerds. Chances are you'll end up working for one.
If you agree, pass it on.
If you can read this - Thank a teacher!
Most of all Thank A Veteran for keeping our country free so this can be passed on to someone else.
HOUSING JUMPS ON OPTIMISM
Consumer sentiment; Housing finance
• The consumer sentiment index has surged out of recession territory. The index rose by 12.7 per cent – the biggest monthly surge in 22 years. The index is now at 17 month highs.
• The number of new housing loans is at 14-month highs, lifting by 0.9 per cent in April. Loans for new construction rose by 1.3 per cent to stand at 5,641 – a seven year high.
• First home-buyers account for over 28 per cent of home loans taken out – the highest on record. Banks account for over 92 per cent of all loans – a 33-year high. The average loan stood at $264,700, up 11.9 per cent on a year ago.
What does it all mean?
• The sharp pick up in business confidence recorded yesterday has been mirrored in the latest consumer sentiment survey. A combination of a firmer sharemarket, super-low interest rates, a stronger Aussie dollar and most importantly, the news of Australia avoiding recession has lifted consumer spirits. For the first time in 17 months there are now more consumers who are optimistic about the future than pessimistic.
• Consumer sentiment has remained in recession territory for over a year, however consistent with the no recession story, sentiment levels have once again reached more optimistic levels. The monthly increase in sentiment was the biggest in 22 years, as confirmation that Australia had avoided a technical recession lifted sprits considerably. It all comes back to job security and if consumers start feeling that employment prospects are holding up relatively well in the current environment, optimism will follow.
• For most consumers the strength of the Australian dollar tends to signify the strength of the economy. The rally in the Aussie over the last few months will make overseas holidays and imports cheaper. Interestingly amongst respondents the “News Heard Index” on the Australian jumped from 32.9 in March to 135.4 in June.
• The latest round of housing finance figures has reinforced our view that the housing sector will be the growth driver over the next year. Overall, the total number of new housing loans is at the best levels in 14 months. A sustained improvement in activity, a significant increase in loan size and importantly a substantial jump in construction of new dwellings are all encouraging signs that rate cuts and government stimulus are working their magic.
• Government forecasts suggest domestic economic activity will remain relatively soft over the next year however we expect the pick up in housing activity will go along way to supporting growth. New construction loans have risen by a further 1.3 per cent in April following the 13.7 per cent surge in March, and are now at the highest levels in over seven years. The knock on effects to housing-related retailers can already be seen with sales of furniture, floor coverings and tiles at the best levels in over seven years.
• Prospective home-buyers are certainly finding the current conditions quite attractive and first home-buyers are taking advantage of the government’s additional boost. Over the last six months over 87,000 properties have been purchased by first home buyers – the best result in records going back 17 years.
• The concerted efforts by the government and the Reserve Bank to stimulate the economy are having the desired effect. Job security remains the one major concern for budding home buyers. If employment manages to hold up relatively well in coming months, demand for homes should gain significant momentum.
What do the figures show?
• Housing finance: The number of new owner-occupier housing loans rose for the seventh straight month in April, lifting by 0.9 per cent. The number of home loans (60,395) is at 14-month highs.
• Construction loans rose by 1.3 per cent, while the purchase of newly erected dwellings fell by 0.5 per cent. The number of new construction loans (5,641) is at seven year highs. Loans for the purchase of established dwellings rose by 0.9 per cent while refinancing rose by 0.3 per cent.
• The value of new housing commitments (owner occupier and investment) rose by 3.6 per cent in April to $21.5 billion. Investment loans rose by 8.9 per cent while owner-occupier loans rose by 1.9 per cent.
• First home buyers accounted for 28 per cent of all lending in April – the highest proportion on record (almost 18 years).
• The average loan stood at $264,700, up 11.9 per cent on a year ago. The average loan by first home-buyers fell by 0.8 per cent in April to $283,400 and stands 19.5 per cent higher than a year ago.
• Banks financed 92.3 per cent of all home loans (by value) in April – holding near 33 year highs.
• The index of consumer sentiment rose by 8.5 points or 12.7 per cent to 100.1 in June. The sentiment index is now up 18.2 per cent on a year earlier.
• The current conditions index rose by 2.2 per cent, while the expectations index surged by 20.7 per cent.
• Four out of the five components of the index rose in June.
• The estimate of family finances compared with a year ago rose by 8.1 per cent while the estimate of family finances over the next year gained by 11.1 per cent. Economic conditions over the next 12 months rose by 37 per cent while the measure of economic conditions over the next 5 years rose by 20.2 per cent
• The measure on whether it was a good time to buy a major household item fell by 1.6 per cent.
• Survey respondents believe that the wisest place to put any extra savings at present is in bank deposits (27.1 per cent of respondents), followed by paying off loans (23.2 per cent), real estate (16.1 per cent) and shares (12.3 per cent).
• The measure of wether it is a good time to buy a dwelling rose by 2.5 per cent to eight year highs, while the index of whether it is a good time to buy a car rose by 8.7 per cent.
What is the importance of the economic data?
• Housing Finance data is produced monthly by the Bureau of Statistics and shows commitments by lenders, such as banks, to provide finance for housing purposes. The lending figures relate to those looking to buy or build homes to live in as well as those seeking to buy or build homes for investment purposes. Generally people get their finance organised first, so the figures are regarded as a leading indicator on the housing market.
• Westpac and the Melbourne Institute release the Index of Consumer Sentiment each month. Roy Morgan conducts a survey of consumer confidence. Both surveys are aggregated from responses to questions on the current and likely future state of family finances, current and likely future state of the economy and whether it is a good time to buy a major household item. Confident consumers may be more inclined to spend, especially on major items.
What are the implications for interest rates and investors?
• The likelihood of further rate cuts is fast being eroded. A sustained improvement in housing activity and stability in global economic conditions is likely to see the Reserve Bank remain on the interest rate sidelines in the near term.
• Investors should think long and hard about property investments. Rents are rising at double-digit rates, construction is not yet keeping pace with population (although latest signs are encouraging), interest rates are low and home prices are rising.
Source Savanth Sebastian - Economist, CommSec
• The consumer sentiment index has surged out of recession territory. The index rose by 12.7 per cent – the biggest monthly surge in 22 years. The index is now at 17 month highs.
• The number of new housing loans is at 14-month highs, lifting by 0.9 per cent in April. Loans for new construction rose by 1.3 per cent to stand at 5,641 – a seven year high.
• First home-buyers account for over 28 per cent of home loans taken out – the highest on record. Banks account for over 92 per cent of all loans – a 33-year high. The average loan stood at $264,700, up 11.9 per cent on a year ago.
What does it all mean?
• The sharp pick up in business confidence recorded yesterday has been mirrored in the latest consumer sentiment survey. A combination of a firmer sharemarket, super-low interest rates, a stronger Aussie dollar and most importantly, the news of Australia avoiding recession has lifted consumer spirits. For the first time in 17 months there are now more consumers who are optimistic about the future than pessimistic.
• Consumer sentiment has remained in recession territory for over a year, however consistent with the no recession story, sentiment levels have once again reached more optimistic levels. The monthly increase in sentiment was the biggest in 22 years, as confirmation that Australia had avoided a technical recession lifted sprits considerably. It all comes back to job security and if consumers start feeling that employment prospects are holding up relatively well in the current environment, optimism will follow.
• For most consumers the strength of the Australian dollar tends to signify the strength of the economy. The rally in the Aussie over the last few months will make overseas holidays and imports cheaper. Interestingly amongst respondents the “News Heard Index” on the Australian jumped from 32.9 in March to 135.4 in June.
• The latest round of housing finance figures has reinforced our view that the housing sector will be the growth driver over the next year. Overall, the total number of new housing loans is at the best levels in 14 months. A sustained improvement in activity, a significant increase in loan size and importantly a substantial jump in construction of new dwellings are all encouraging signs that rate cuts and government stimulus are working their magic.
• Government forecasts suggest domestic economic activity will remain relatively soft over the next year however we expect the pick up in housing activity will go along way to supporting growth. New construction loans have risen by a further 1.3 per cent in April following the 13.7 per cent surge in March, and are now at the highest levels in over seven years. The knock on effects to housing-related retailers can already be seen with sales of furniture, floor coverings and tiles at the best levels in over seven years.
• Prospective home-buyers are certainly finding the current conditions quite attractive and first home-buyers are taking advantage of the government’s additional boost. Over the last six months over 87,000 properties have been purchased by first home buyers – the best result in records going back 17 years.
• The concerted efforts by the government and the Reserve Bank to stimulate the economy are having the desired effect. Job security remains the one major concern for budding home buyers. If employment manages to hold up relatively well in coming months, demand for homes should gain significant momentum.
What do the figures show?
• Housing finance: The number of new owner-occupier housing loans rose for the seventh straight month in April, lifting by 0.9 per cent. The number of home loans (60,395) is at 14-month highs.
• Construction loans rose by 1.3 per cent, while the purchase of newly erected dwellings fell by 0.5 per cent. The number of new construction loans (5,641) is at seven year highs. Loans for the purchase of established dwellings rose by 0.9 per cent while refinancing rose by 0.3 per cent.
• The value of new housing commitments (owner occupier and investment) rose by 3.6 per cent in April to $21.5 billion. Investment loans rose by 8.9 per cent while owner-occupier loans rose by 1.9 per cent.
• First home buyers accounted for 28 per cent of all lending in April – the highest proportion on record (almost 18 years).
• The average loan stood at $264,700, up 11.9 per cent on a year ago. The average loan by first home-buyers fell by 0.8 per cent in April to $283,400 and stands 19.5 per cent higher than a year ago.
• Banks financed 92.3 per cent of all home loans (by value) in April – holding near 33 year highs.
• The index of consumer sentiment rose by 8.5 points or 12.7 per cent to 100.1 in June. The sentiment index is now up 18.2 per cent on a year earlier.
• The current conditions index rose by 2.2 per cent, while the expectations index surged by 20.7 per cent.
• Four out of the five components of the index rose in June.
• The estimate of family finances compared with a year ago rose by 8.1 per cent while the estimate of family finances over the next year gained by 11.1 per cent. Economic conditions over the next 12 months rose by 37 per cent while the measure of economic conditions over the next 5 years rose by 20.2 per cent
• The measure on whether it was a good time to buy a major household item fell by 1.6 per cent.
• Survey respondents believe that the wisest place to put any extra savings at present is in bank deposits (27.1 per cent of respondents), followed by paying off loans (23.2 per cent), real estate (16.1 per cent) and shares (12.3 per cent).
• The measure of wether it is a good time to buy a dwelling rose by 2.5 per cent to eight year highs, while the index of whether it is a good time to buy a car rose by 8.7 per cent.
What is the importance of the economic data?
• Housing Finance data is produced monthly by the Bureau of Statistics and shows commitments by lenders, such as banks, to provide finance for housing purposes. The lending figures relate to those looking to buy or build homes to live in as well as those seeking to buy or build homes for investment purposes. Generally people get their finance organised first, so the figures are regarded as a leading indicator on the housing market.
• Westpac and the Melbourne Institute release the Index of Consumer Sentiment each month. Roy Morgan conducts a survey of consumer confidence. Both surveys are aggregated from responses to questions on the current and likely future state of family finances, current and likely future state of the economy and whether it is a good time to buy a major household item. Confident consumers may be more inclined to spend, especially on major items.
What are the implications for interest rates and investors?
• The likelihood of further rate cuts is fast being eroded. A sustained improvement in housing activity and stability in global economic conditions is likely to see the Reserve Bank remain on the interest rate sidelines in the near term.
• Investors should think long and hard about property investments. Rents are rising at double-digit rates, construction is not yet keeping pace with population (although latest signs are encouraging), interest rates are low and home prices are rising.
Source Savanth Sebastian - Economist, CommSec
Tuesday, June 2, 2009
RBA HOLDS RATES + OUTLOOK
RBA stays put
Update The Reserve Bank held interest rates steady for a second month in a row, arguing that emerging signs of a recovery averted the need for an additional cut.
The key cash rate remains at a 49-year low of 3 per cent. The central bank had lopped 425 basis points from the official rate between last September and April in a bid to keep the economy expanding through a global downturn.
For a range of tools to help you calculate your home loan, click here.
Rates stay the same, for now...
Business Day reporter Chris Zappone sees signs of rate rises in the next year.
''Evidence has continued to emerge that the global economy is stabilising, after a sharp contraction during the December and March quarters,'' RBA Governor Glenn Stevens said in a statement.
''The considerable economic policy stimulus in train in most countries is helping to contain the downturn, and should support an eventual recovery,'' Mr Stevens said.
The federal government has pumped more than $50 billion into the economy in the last half year and earmarked record investments - and record deficits - to compensate for an expected slump in business spending.
''It is very important that fiscal and monetary policy is working together to stimulate our economy, to support vital employment in the economy, to support the business community and to support the rural community,'' Treasurer Wayne Swan told reporters.
The Australian dollar retreated after the RBA announcement, buying 80.55 US cents, or down about half a US cent. Stocks held on to their gains of about 1.6 per cent for the day, closing at their highest for 2009.
Rates outlook
Today's RBA statement convinced some economists that the RBA's series of rate cuts is over, with a rate rise becoming a possibility before the year is out.
Macquarie interest rate strategist Rory Robertson noted the RBA's readiness to cut interest rates again ''if needed.''
''The story that's been emerging in the last few weeks is that low rates are promoting growth. Home construction and home prices are turning higher, showing that policy is working,'' he said.
"So, the RBA is on hold for the foreseeable future, and we're less sure that there will be any further rate cuts at all."
ICAP's chief economist Adam Carr is penciling in a rate rise.
''I don't think they will ease again, given the domestic and global economy recovery. I think rates will be on hold until the end of the year with a potential for a rate hike by December."
Each-way bet
Moody's Economy.com's Matt Robinson said the RBA's accompanying statement ''starts off very bold, with confident statements about a turnaround evident in global economy, particularly China and the emerging markets'' but that upbeat view is set against a readiness to reduce rates again.
The RBA seems to be ''confident enough of an eventual recovery that interest rates aren't going to be eased further,'' he said. ''At the same time it's sending a clear signal to markets that have been pricing in optimism about growth, in particular through higher long-term yields,'' that the RBA remains ready to cut again.
''This is the RBA's implied way of saying the market is getting ahead itself (with expectations of higher rates) and there is little chance of a rate rise any time soon,'' Mr Robinson said.
In recent weeks, the market has been pricing in the possibility of an interest rate within 12 months, according to data from Credit Suisse. Today, the market expectation rose to a full 25 basis points increase by next June, underscoring hopes of a recovery
Update The Reserve Bank held interest rates steady for a second month in a row, arguing that emerging signs of a recovery averted the need for an additional cut.
The key cash rate remains at a 49-year low of 3 per cent. The central bank had lopped 425 basis points from the official rate between last September and April in a bid to keep the economy expanding through a global downturn.
For a range of tools to help you calculate your home loan, click here.
Rates stay the same, for now...
Business Day reporter Chris Zappone sees signs of rate rises in the next year.
''Evidence has continued to emerge that the global economy is stabilising, after a sharp contraction during the December and March quarters,'' RBA Governor Glenn Stevens said in a statement.
''The considerable economic policy stimulus in train in most countries is helping to contain the downturn, and should support an eventual recovery,'' Mr Stevens said.
The federal government has pumped more than $50 billion into the economy in the last half year and earmarked record investments - and record deficits - to compensate for an expected slump in business spending.
''It is very important that fiscal and monetary policy is working together to stimulate our economy, to support vital employment in the economy, to support the business community and to support the rural community,'' Treasurer Wayne Swan told reporters.
The Australian dollar retreated after the RBA announcement, buying 80.55 US cents, or down about half a US cent. Stocks held on to their gains of about 1.6 per cent for the day, closing at their highest for 2009.
Rates outlook
Today's RBA statement convinced some economists that the RBA's series of rate cuts is over, with a rate rise becoming a possibility before the year is out.
Macquarie interest rate strategist Rory Robertson noted the RBA's readiness to cut interest rates again ''if needed.''
''The story that's been emerging in the last few weeks is that low rates are promoting growth. Home construction and home prices are turning higher, showing that policy is working,'' he said.
"So, the RBA is on hold for the foreseeable future, and we're less sure that there will be any further rate cuts at all."
ICAP's chief economist Adam Carr is penciling in a rate rise.
''I don't think they will ease again, given the domestic and global economy recovery. I think rates will be on hold until the end of the year with a potential for a rate hike by December."
Each-way bet
Moody's Economy.com's Matt Robinson said the RBA's accompanying statement ''starts off very bold, with confident statements about a turnaround evident in global economy, particularly China and the emerging markets'' but that upbeat view is set against a readiness to reduce rates again.
The RBA seems to be ''confident enough of an eventual recovery that interest rates aren't going to be eased further,'' he said. ''At the same time it's sending a clear signal to markets that have been pricing in optimism about growth, in particular through higher long-term yields,'' that the RBA remains ready to cut again.
''This is the RBA's implied way of saying the market is getting ahead itself (with expectations of higher rates) and there is little chance of a rate rise any time soon,'' Mr Robinson said.
In recent weeks, the market has been pricing in the possibility of an interest rate within 12 months, according to data from Credit Suisse. Today, the market expectation rose to a full 25 basis points increase by next June, underscoring hopes of a recovery
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